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BENCHMARK 2000 DATABASE

Not all catalogers, it seems, are sold on database marketing. As is to be expected, the larger catalogers that participated in Catalog Age’s 2000 Benchmark Report on Database conduct far more database marketing than their smaller counterparts.

While catalog respondents with sales of $10 million or more (33% of respondents) spend a mean of $18,000 annually on database marketing activities, catalogers with sales of less than $10 million spend a mean of just $600 a year.

Of course, smaller catalogs have fewer names to track. Of those respondents with annual sales of less than $10 million and who know the size of their database, 75% have 200,000 or fewer names. But while smaller databases may be less expensive to maintain than those with millions of buyers, the stakes are as high for the smallest respondents as they are for the largest: 40% of survey participants with sales of less than $10 million report that their customers’ lifetime value (LTV) exceeds $500 vs. 43% of those with sales of more than $10 million.

Apart from the 3% of respondents who do not know what types of data their companies maintain in their customer files, nearly all the respondents say they keep a record of customers’ product purchase history. After that, a division grows regarding the data maintained by consumer catalog respondents and business-to-business respondents.

As expected, b-to-b respondents report no interest in their customers’ ages, but perhaps curiously, only 20% of consumer respondents maintain this information. And of course, b-to-b databases are more likely to contain standard industrial classification (SIC) codes (17% vs. 4% of consumers’ databases).

Most of the respondents (89%) maintain their own database. At more than half of respondents’ companies, the president, the CEO, or the owner controls the database, which does not vary much among the consumer and b-to-b segments. But slightly more than 32% of participants say the marketing department controls the database, while 24% report that the MIS department does. Still another 10% list “other” as the keeper of the database.

A sizable gap exists between the consumer and business-to-business sectors when it comes to budgeting for database marketing: Consumer respondents dedicate a mean 1.4% of their total budget to database maintenance and development, while b-to-b respondents allot just a mean of 0.5% of their total budget for database marketing.

As for how catalogers use their data, modeling appears to be an overlooked database marketing tool. A mere 46% of the total respondents report using modeling. Looked at by type, business-to-business respondents are less likely to use house file modeling techniques: 61% of b-to-b respondents say they don’t use modeling, while only 42% of consumer respondents say the same.

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